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The year 1997 marked the beginning of a slump in retail sales for the Dairy Farm Group of Companies (DFG), a major Hong Kong based food retailer with operations in a large number of major cities in Asia Pacific. The economic crisis that gripped the Asian countries during the latter part of 1997 was one reason. However, a major cause was the increasing competitive pressures that DFG faced from aggressive European and US retail chains that were preparing to gain a foothold in the growing Asian market. DFG realised that in order to combat competition and retain its dominant position in Asia Pacific as a major retailer, it had to change. There had to be a change in its business strategy - from that of ''buying and selling'' to ''sensing and responding''. The case investigates DFG''s existing business systems and processes and looks at the possibilities of gaining competitive advantage either by way of acquiring state of the art systems and technical infrastructure or through radical re-design of its critical business processes supported by technology. The case is suitable for teaching the following: (1) How organisations gain competitive advantage through business process re-engineering (BPR); (2) IT as a facilitator of BPR; and (3) Competitive advantage through supply chain integration and logistics management.